Learning Path
Question & Answer
Choose the Best Answer
Buy 7 apples and 0 oranges
Buy 5 apples and 1 orange
Buy 3 apples and 2 oranges
Buy 0 apples and 3 oranges
Understanding the Answer
Let's break down why this is correct
To decide what to buy, compare the utility gained per dollar for each fruit. Other options are incorrect because The idea that buying only apples is best ignores that oranges give 3 utils per dollar; Buying 5 apples and 1 orange spends $7 and seems balanced, but the orange uses only 2 dollars for 3 utils per dollar.
Key Concepts
Marginal Utility Per Dollar
hard level question
understand
Deep Dive: Marginal Utility Per Dollar
Master the fundamentals
Definition
Marginal Utility Per Dollar is a concept in Economics that helps consumers maximize utility by considering the additional satisfaction gained from spending one more dollar on each good. In this scenario, the consumer chooses the combination of apples and oranges that provides the highest marginal utility per dollar spent within the budget constraint of $7, demonstrating rational consumer decision-making.
Topic Definition
Marginal Utility Per Dollar is a concept in Economics that helps consumers maximize utility by considering the additional satisfaction gained from spending one more dollar on each good. In this scenario, the consumer chooses the combination of apples and oranges that provides the highest marginal utility per dollar spent within the budget constraint of $7, demonstrating rational consumer decision-making.
Ready to Master More Topics?
Join thousands of students using Seekh's interactive learning platform to excel in their studies with personalized practice and detailed explanations.